As shopping malls pack out with Christmas shoppers desperate to score bargains for presents, warnings have been made that the country's economy is still leaving many in poverty and financially struggling.

Working for Families payments have boosted tax credit rates, meaning families can now claim between $136 and $144 a week depending on their circumstances.

Talking to the Mike Hosking Breakfast, Child Poverty Action Group convener Alan Johnson was asked why so many people were hitting shopping malls when there's ongoing talk of the country suffering from the cost of living.

Johnson said the country is still very much in need of financial support as it recovers from a recession triggered by the Covid-19 pandemic, and about half a million people a month rely on a foodbank handout.

"So, it's an indication not everyone is doing it well - and remember the Government campaigned on the squeezed middle, which was suffering under previous Governments' policies."

Indexing tax settings to inflation was an idea that sat well with Johnson, who had seen families watch their pay rises get eaten away by higher tax brackets that weren't marked against inflation.

However, he didn't think the current payment amounts were anything near what could be considered a generous contribution from the Government.

He said the amounts are only as generous as they were last year when it sat at the lower amounts.

"Clearly, what we've seen here is an adjustment for the fact that groceries, fuel and electricity and everything else has gone up by maybe 3-5 per cent," he said.

"Our view is that the system could be made more generous to relieve child poverty. I agree it does look like things are going well [during the festive season] for a large part of the population, but whether or not it's just a pre-Christmas rush and fuelled by credit card spending remains to be seen."

The family tax credit is received by most of the more than 300,000 people who receive Working for Families credits.

Prime Minister Christopher Luxon said the Government was starting the 100-day plan with a “laser focus” on bringing down the cost of living.

The best start tax credit rate increases from $69 to $73 a week after tax in April next year.